Entrepreneurship, Innovation and Economic Development “‘Discuss the relationship between entrepreneurship, innovation and economic development. What role do creativity and problem solving play in this relationship? ” In today’s world, entrepreneurship….
Business and Entrepreneur
The word ‘entrepreneur’ is derived from the French word ‘enterprendre’ which means ‘to undertake’. Around 17th century, this term was used for architects and contractors for public works. Later it was applied to the function of engaging labor and buying materials and selling the resultant products at contracted prices. In fact, it was in 18th century that the term ‘entrepreneur’ was applied initially to business by the French economist Cartillon who designated him as a dealer who purchases the means of production for combining them into marketable products. Another Frenchman J. B.
Say, expanded Cartillion idea and conceptualized entrepreneur as an organizer of a business firm. The term “Entrepreneurship” refers to the function of entrepreneur. Entrepreneurship is one of the most important inputs in the economic development of a country. It is the willingness to undertake conception, organization, and management of a productive venture with all attendant risks, while seeking profit as a reward. It is the one who starts a new business, undertakes risk, bears the uncertainties and performs the managerial functions of decision making and coordination.
Entrepreneurship can be describe as a creative, innovative, contributor, collaborator and dynamic response to the environment and the process of giving birth to a new enterprise. Such response can take place in any field of social Endeavour, business, agriculture, education, social work etc. 1. 2 Reason for Choosing the Topic I choose this topic because it can help the economic growth and to give more information and facts about Entrepreneurship, to understand what entrepreneurship is, and what are the objectives that to be observed. 1. 3 Discuss the Problem/Issues
A business enterprise comes into existence due to the pioneering efforts of entrepreneurs. However, there are several issues and problems faced by entrepreneurs while giving shape to their idea. These are as follows: * Selection of business- Many of entrepreneurs are difficult to choose what business to be build and how to manage it. First of all, he/she make a study to know what will be the products are accepted by the market and accepted by the people. For the purpose, the entrepreneur has to determine the market demands of the intended products/services and carry exercises to find out the projected costs of the product or services.
In this way, the entrepreneur shall be able to know as to whether the venture is profitable or not. This study is called “Feasibility Study”. Then, after viewing the results, the entrepreneur will make an idea based on his/her study to identify what business fits in our society. This study will help him/her to choose what business will be build. * Choice of form of business enterprises- There are various options available to the entrepreneur as far as the choice of form is concerned. She/he may go in for sole proprietorship, a partnership or a joint stock company. The businesses that will he/she made depends on how will he/she handle it.
The size of the business will determine the form of organization. Apparently, company form of organization is suitable in case of large-scale operations, while sole proprietorship or partnership is considered more suitable for small scale and medium scale operations. * Financing- The problem of arranging finances always troubles the entrepreneur. As we know, without capital, the business activity will not be able to start. Capital is the needs of an entrepreneur to buy fixed assets like land and building, machinery, equipment, etc. Further, finance is needed to meet day-to-day expenses of the business.
Having built up the estimate of the amount of capital required, the entrepreneur may have to arrange finance from various sources. So, the entrepreneur shall have to approach these financial institutions and bankers for the purpose, provide some funds on his own and plan for a public issue of capital at the appropriate time. * Location- Locating a business is another issue for consideration that should be carefully handled by entrepreneur. Location of a business unit depends on many factors like availability of raw materials, availability of transport, power, water, nearness to market, etc.
The government also provides many incentives in the form of tax holidays, rebate in power and water bills etc. to the unit located in a backward area or underdeveloped area. Thus, the entrepreneurs need to look at all these factors before setting up a business unit. * Size of a business unit- The size of a business is influenced by several factors like technical, financial and market considerations. When entrepreneur feels that they can market the intended products and services and can raise sufficient amount of capital, they can start an operations in a big way.
Generally, entrepreneurs can start their operation in a small scale and expand after. * Machines and equipment- The choice of machines, equipments and processes is a delicate problem before starting a new venture. This depends on various factors like availability of funds, size of production, and the nature of production process. Availability of facilities of repairs and maintenance, availability of spare parts and after sale service is also an important consideration while selecting a particular equipment and machinery.
* Manpower- The business will not able to operate if they have not workers. An entrepreneur has to identify the right person in each area where they will be are designated and motivate them to join the set up. It is not easy because you need a lot of patience and persuasion in finding an employee. The entrepreneur has to find solution to many problems or issues before launching a new business. The successful of a business depends on making a proper choices and arrangements.